Driven by the AI boom and robust consumer demand, U.S. tech giants have entered a "golden era," with Microsoft and Apple both surpassing the $4 trillion market cap milestone, while chip leader NVIDIA steadily approaches the $5 trillion mark.
On Tuesday, October 28, Apple's stock rose slightly, briefly crossing the $4 trillion valuation during trading before settling at $3.99 trillion at close, becoming the third company after NVIDIA and Microsoft to hit this milestone. This marked Apple's first time breaching the $4 trillion threshold.
Meanwhile, Microsoft's shares climbed 2%, solidifying its market cap at $4.03 trillion. The immediate catalyst was a major restructuring deal with OpenAI, which significantly boosted the value of Microsoft's stake in the AI firm. Reports indicate OpenAI's restructuring valued the company at $500 billion, with Microsoft holding a 27% stake worth approximately $135 billion.
As the biggest beneficiary of the AI surge, NVIDIA's growth has been even more explosive. After announcing a series of new deals, its stock surged 5% on Tuesday, briefly pushing its market cap above $4.9 trillion before closing at $4.88 trillion.
This rally among tech giants comes ahead of a wave of earnings reports. This week, Microsoft, Alphabet, Meta, Apple, and Amazon—members of the "Magnificent Seven"—are set to release their quarterly results.
**Microsoft: OpenAI Restructuring Accelerates AI Commercialization** Microsoft's renewed market cap surge stems from its deep AI investments and commercialization efforts. The OpenAI restructuring deal was pivotal in pushing its valuation past $4 trillion. Under the agreement, OpenAI formed a for-profit entity called "OpenAI Group," paving the way for a potential IPO. As OpenAI's largest single shareholder, Microsoft holds a 27% stake in the new entity. This arrangement not only delivered a nearly tenfold return on Microsoft's $13.75 billion investment since 2019 but also secured long-term access to OpenAI's cutting-edge technology. Although Microsoft relinquished its exclusive cloud provider rights under the new deal, sources familiar with the negotiations called it an "excellent transaction" that ensures both substantial returns and future partnership stability. The deal grants Microsoft access to OpenAI's models until 2032, with OpenAI committing to invest $250 billion in Microsoft's Azure cloud services—cementing Azure as the go-to platform for AI development.
**Apple: Strong iPhone Sales Defy Market Expectations** Unlike Microsoft and NVIDIA, Apple's $4 trillion milestone was driven by its hardware ecosystem and stronger-than-expected consumer demand. Counterpoint Research reported that Apple's iPhone 17 series saw a 14% year-over-year sales jump in the U.S. and China during its first 10 days. Analysts noted that demand for the base iPhone 17 exceeded last year's levels, while the ultra-thin iPhone Air sold out in minutes in China. The robust sales reversed earlier Wall Street pessimism. Despite lagging in AI innovation, Apple's stock has recently seen multiple analyst upgrades. External factors, such as a court ruling allowing Google to continue paying billions to remain iPhone's default search engine and tariff exemptions on most Apple products, also buoyed sentiment.
**NVIDIA: Strategic Deals Propel It Toward $5 Trillion** As the "arms dealer" of the AI revolution, NVIDIA is unstoppably advancing toward a $5 trillion valuation, fueled by high-profile partnerships. Reports revealed NVIDIA's collaboration with Eli Lilly to build the pharmaceutical industry's most powerful supercomputer for drug discovery. CEO Jensen Huang also unveiled "NVQLink," a breakthrough technology bridging quantum and classical supercomputers. Additionally, NVIDIA announced a $1 billion investment in Nokia for AI collaboration, securing a 2.9% stake post-deal. These moves reinforce NVIDIA's dominance in AI infrastructure while expanding its technological reach. Year-to-date, NVIDIA's stock has soared 50%, outpacing Apple (7.5%), Alphabet (42%), and Meta (28%), while the S&P 500 rose 18% over the same period.